5 Ways to Prepare for a Potential Recession as a Freelancer

#4: Make a list of jobs and companies you’re going to apply to if you get fired

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Photo by Ali Yahya on Unsplash

There’s one thing we can be certain of right now; everything is going to change.

  • Your work environment might change from co-working spaces to your dining room table

If you’re a freelancer, you have to realize that things are going to change, but that change isn’t necessarily a bad thing—as long as you’re prepared for it.

Preparation is going to be the key to your business's survival right now. You can’t be hoping for the best, you have to be planning for the best.

I picture my career as a game of chess. I have to make the right moves now to set myself up for success in the future.

While everything seems to be on hold right now, this is a critical time to prepare for the “What ifs” that have suddenly become extremely prevalent in the back of your mind.

Here are the 5 ways to prepare for a possible recession as a freelancer.

#1: Define your best and worst-case scenario

A lot of our stress comes from the unknown that sparks us to ask the “What if” questions like, What if I lose my job?

You can’t predict the future, but you can plan for it. You can take the unknown future and create a known action plan that you’re going to follow if something happens. This is the same methodology behind practicing fire drills. You don’t want to be in a fire, reading the exit strategy.

You want to know exactly what you’re going to do the second you feel the heat from the flames. Do this for future you.

Ask yourself, what is the best-case scenario that comes from this and what is the worst-case scenario? Define each scenario so that you can understand what is going to happen and what you’re going to do about it if it does.

#2: Get sober on the possibility of losing your job

This isn’t meant to be a scary thought and if you feel scared when you read that, it’s a sign you need to be more prepared. When you’re prepared, reading that sentence feels painful, but not like the end of the world.

Understanding that you might lose your job because your client can’t afford your services is the first step in realizing that you need to have a Plan B. If the message comes in that your client wants to put a project on hold indefinitely than it’s important that you’re not stunned—you’re ready to go into crisis mode.

#3: Crunch the numbers

Open up your bank account, credit card statements, and monthly bills. Pull up your calculator on your phone. Open a blank document or have a piece of paper and pen next to you.

And crunch the numbers.

  • How much money do you have?

Don’t leave yourself to figure this out when your client says that they need to pause your project. Do it today, so you know exactly how much runway you have.

#4: Make a list of jobs and companies you’re going to apply to if you get fired

I have a list in my notebook of all of the companies and positions I’m going to apply for if I get laid off by one of my clients. I kept this last prior to the chaos of the past few weeks, but now more than ever does it seem like a fundamental for every freelancer.

The key to not feeling stressed out and like you’ve lost control is to keep the control. You keep the control by having your plan and saying, “Okay, Client X needs to stop working together indefinitely, so I’m going to reach out to Company A, Company B, Company C, and Company D and see how I can help them.”

If you’re thinking, “But NOBODY is going to be hiring!” you’re not thinking from an opportunistic mindset. Tons of companies are going to have to scale back, but other companies are going to be able to scale forward during this time. Be strategical about the companies you’re choosing and look for companies with:

  • High margin products (Ex. Newsletters)

Figure out on a client-by-client basis what you’re going to do if they pause your projects.

#5: Get ready to ask clients to recommend you to their colleagues, friends, etc.

This is not the time for ego. If your clients have to let you go, you want to ask them for two things:

  1. A testimonial

There’s no reason to be angry, frustrated, or feel defeated. While this is definitely a stressful message to receive, all that you can control is your reaction to this message. As a freelancer, your business can thrive off of personal recommendations and reviews. Right now, you have the opportunity to get them.

Don’t reply to that unfortunate email without asking for these two things.

Recessions as a freelancer are scary, but only if you let yourself live in the unknown. We can’t predict what next week will look like, but we can predict our reaction to it.

By figuring out your plan for whatever scenario is upcoming, you don’t have to live in the unknown because no matter what the future holds, you have a plan for it.

And that’s going to be your edge during this volatile time.

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